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Caribbean-Latin America |
Hugo Chavez Cuts His Own Throat |
2008-02-14 |
Venezuela president Hugo Chavez says he will not send anymore crude to Exxon (XOM). The most profitable US company has frozen $12 billion assets from the Latin American country's state owned oil operation to offset assets which the government nationalized. Exxon can get oil elsewhere, at least for the time being. It is likely to be supported in its fight by other large oil companies who have also been bullied by Chavez. OPEC members are also likely to help Exxon's crude supply moving. They do not want to be seen as aiding and abetting a rise in the price of oil, even if it might benefit them for a period. Chavez cannot be certain that the oil he does not send to Exxon will find a place somewhere else. Doing business with Venezuela has not exactly taken on the dressings of stability. He can turn to China as a buyer, but the Asian country is likely to drive a hard bargain if it sees Chavez has excess crude. That will tend to drive the price lower, which works against Venezuelan interests. The most important barometer of whether the Chavez move is working is the price of oil. It has not gone up much in the last two days. And, certainly not to the $200 level that the president-for-life predicted. |
Posted by:Fred |
#7 Relax gromky, that's 24/7 wall street's title, not Fred's. And it just so happens that I agree with the sentiment. In fact, I couldn't agree more. Venezuela used to be a good friend to us before that skidmark took over. |
Posted by: Blinky Thusosh7431 2008-02-14 13:05 |
#6 Since Hugo has taken office oil production in Venezuela has dropped from 3.3 million barrels per day to 2.5 million barrels per day and continues to drop. This is where he has truly cut his throat. The Exxon dispute is a smokescreen to hide the incompetence of his government and his economic policies. |
Posted by: DoDo 2008-02-14 11:43 |
#5 Sounds great Spiny GI. I will start digging under my desk. The oil must flow. |
Posted by: Excalibur 2008-02-14 09:57 |
#4 And don't forget that while Exxon is the front man, Uncle Sugar gets his cut. |
Posted by: Procopius2k 2008-02-14 08:29 |
#3 hugo will meet the actual science of crude oil soon, see the above article on titan. Once the myth of oil as a fossil fuel is debunked, the work of actually locating it becomes far simpler. See my reply under the titan story. Hugo is leveraging aa myth out of his own inability to accept reality, socialism and crude oil as fossil fuel, are just plain stupid. |
Posted by: Spiny Gl 2511 2008-02-14 08:17 |
#2 Exxon (XOM). The most profitable US company has frozen $12 billion assets I suspect Exxon and the US Government fully anticipated Hugo's response and had numerous couses of action and OPEC member agreements quickly at hand. There really is not fixing stupid. |
Posted by: Besoeker 2008-02-14 06:46 |
#1 He's not "cutting his own throat", he's pursuing his foreign policy objectives, even if they prove detrimental to his short-term cash flow. Jeez I hate Hugo just as much as everyone else, but it doesn't help anyone when we describe his actions like this. |
Posted by: gromky 2008-02-14 00:06 |